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A state-sponsored Forest Management Bureau is evaluating alternative routes for a new road into a formerly inaccessible region. Three mutually exclusive plans for routing the

A state-sponsored Forest Management Bureau is evaluating alternative routes for a new road into a formerly inaccessible region. Three mutually exclusive plans for routing the road provide different benefits, as indicated in table below. The roads are assumed to have an economic life of 50 years, and MARR is 6% per year. Which route should be selected according to the B-C ratio method? Assume that a roadway must be constructed.

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Route

Construction Costs

Annual Maintenance Cost

Annual Savings in Fire Damage

Annual Recreational Benefit

Annual Timber Access Benefit

A

350000

4300

11000

5500

2500

B

230000

3000

8000

6500

1400

C

180000

1600

5000

2500

500

Click the icon to view the interest and annuity table for discrete compounding when the MARR is 6% per year.

Perform the incremental B-C Analysis. Fill-in the table below. (Round to four decimal places.)

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